Thursday, January 26, 2017

I am a hotel owner. I sometimes have guests sneaking in more guests who are not registered. Our liability insurance only covers guests, and these extra visitors use our amenities and often leave the place a mess, and are a nightmare when they injure themselves, etc. How do I deal with this?

You don't have my shoulder to cry on about this one.
I've never visited your hotel (I'm assuming here that it's in the USA), but if I did, what I'd expect to find is that you've got bigger problems than guests sneaking in extra people; and that the way you operate, you're bringing it down on your own head.
And if I had your guest list in front of me, I'd also be willing to bet before even looking at it that most of your guests live in or around a single city - the one in which your hotel is located. I suspect based on the information that you provide in your question that your hotel's business is entirely too 'local'-dependent.
Image result for hot pillow motel
And you've let it, or you're letting it, get out of control. Simply put, your hotel's security sucks.
So far, you've gotten off easy with high cost of amenities that non-guests help themselves to, and some property damage. Eventually, you're going to have a serious crime occur there.

And if you even have a sales and marketing department, it's no improvement over your security: indeed, sales and marketing done the way it is at your property is to blame. But then again, if you run one of the cheaper hotels in town, and your idea of marketing is, "don't let anyone walk away"; then you don't need a whole lot of attention to sales and marketing, right? Have you ever seen what we call an 'S.O.B report' [yes, there really is such a thing, and it doesn't stand for something ugly or insulting], and would you know what to do with it if your night auditor prepared one for you each night? Do you understand the difference between transientcorporate, and group?  No?  You don't?  Didn't think so . . .
I'd fire the manager and replace him for letting the hotel get that way  --  it's that serious. Any one who works with me - including a few former employers I used to argue with about it before I said the hell with them all and started my own company - knows I demand and expect better.
Since I don't know you, I'm going to assume you might be redeemable and try to be not so harsh on you. At least you're willing to recognize and admit you have a problem: most owners I've seen who experience this sort of thing rationalize it as something that goes with the territory if you run a cheaper hotel or motel. But your problem is something I can't describe as anything other than what it is. 
Your hotel needs to be completely repositioned, perhaps even shut down for a month or so in the interim if it's as bad as some I've seen that have this problem. Rebranding is something to think about, depending on how bad your hotel's reputation has gotten in your surrounding community.
The traveling public -- who hotels are presumed to serve -- doesn't bring around extra people to sneak into the room; and even if they arrive in a full carload, generally can't count on a back door being open through which they can sneak in more than half their party when they arrive, unless they know your hotel.
On the other hand, if you rent most of your rooms to people who live in your own town, as many older hotels do; then yes, your guests are going to bring in extra people - through the back door if your clerks don't simply let them parade past the desk - and your hotel is even going to occasionally be the local party spot. (And you don't control the party. So, there is probably drug use taking place, and borderline criminal activity.)
If guests occasionally injure themselves, as you say, then the only reason you're not losing a significant portion of your revenue on lawyers' bills is because they're in there doing things they don't want too many people to know about. But it's a matter of time until that changes, until someone figures their shot at the litigation lotto is worth taking even if it results in a revelation about themselves most of us would find embarrassing, and until some lawyer figures, no matter what kind of questionable activity that plaintiff was there on your property to involve himself in, it doesn't justify the 'personal injury' that happened to them . . .
First of all, get this. All guests are NOT created equal. It's not the kind of statement that wins elections (especially if you're running as a Democrat), but you're not running for office, you're running a hotel.
Members of the traveling public -- transient guests, family travelers, business travelers, corporate and group travelers --  willingly pay fifty to seventy-five bucks a night more to stay at a Holiday Inn Express or Hampton Inn (where the rooms aren't that much cleaner, and the beds and the free continental breakfast aren't that much better, than at a well-run Quality Inn or Super 8 Motel) because they don't want to be around the crap you'll have present at your property if most of your guests are local people.
In years past - recently enough, in fact, that I've worked in hotels that have done it - many hotels had a 'no locals' policy. If you lived in the same town as the hotel, or in the surrounding area within commuting distance, you could not get a room there under any circumstances. It's generally not necessary these days to go quite that far with it, but it can be if lesser measures won't prevent serious problems.  (I'm on the road as I write this, and I'm writing it from a hotel in Chapel Hill, North Carolina, that still does. If that's what it takes, then that's what it takes. This is one of the best hotels for the money that I don't run.)
Modern technology and computerized guest history databases make it possible to manage the phenomenon. If you want to accept local people as part your customer base, fine. (I don't hate local people. Among the hotels where I live, I'm 'local people'.) But if you want to survive as a hotel, you do have to manage it. 85% to 90% of your problems come from local people, but 85% to 90% of your local people give you no problems. 
You just have to deal assertively, and conclusively, with those who do. You can't just let them take over, and you don't want your transient, corporate or group guests seeing bad behavior. (Or even worse, seeing people getting away with it. And you certainly don't want any local residents you have among your guests to see someone getting away with it - it'll tell 'em what they can get away with.) And you don't want to become dependent on them: once you do, you're finished as a hotel, and it's a matter of time before your property is mostly weekly renters and SRO's (Michael Forrest Jones' answer to What do hotels do with unused guest rooms?  ).
Our policy is, we'll rent to locals - but screw up just this much, even once, and you're forever out of here. And once it happens, that's it: there's no avenue of appeal, and no second chances. I don't care if all you did was answer back to a desk clerk, that you deny you did even that or that you say the clerk was 'rude', and that it's just his word against yours; I don't want to hear it. When a manager isn't present, the clerks run the hotel, you don't; if there's a problem, keep your mouth shut and take it up with management in the morning. It's not the way to do customer relations with the traveling public that we're there to serve, but local people need to be made to understand that it doesn't take much by way of bad behavior to get them permanently booted out of there. Besides, there's no reason it should be an issue for anyone, even you: if you are local, and you behave yourself as well as a 'real' guest, we'll treat you as well as we do a 'real' guest.
We don't owe you. The amount of money you're paying doesn't matter: we're not going to be dependent on that kind of money. (And even if we do, it won't be a problem. This very policy was in place at a hotel in Greenville, N. C., where I worked twenty years ago, which had a bad franchise and operated under a weak brand, and where the business was more than 90% local people - and by sticking to a policy that was very much like mine, we had very few problems. Even without a security guard.) There's no justification.  If you brought a friend and your friend did it, you've got the wrong kind of people for friends: if you rented the room, you're still responsible.
Furthermore:
  • Every arriving guest gets run through a guest search on our property management system, so that the clerk has a record of his or her previous stays in front of him or her - and maybe a DO NOT RENT flag because of something that happened during one of those stays.
  • No discounts. If you live in the surrounding area, you pay rack rate. I won't even give you AAA - if it's a problem, find another hotel. Today's compromise is tomorrow's norm. By cutting deals to local people, you're cutting your rate and reducing your revenue, and, as they spread the word around to one another, subjecting your clerks to a haggle or an argument every time one shows up. If you frequently get calls at your front desk by people asking "how much is a single?", and Clerk A tells them $75.00, and Clerk B tells them $75.00, and Clerk C tells them $67.50, and Clerk D tells them $75.00; guess whose shift they're going to check in on, and what the rate is going to be? And this is before we even go there about the distracting volume of your incoming phone traffic, from people in the area who call around different hotels hoping to find the cheapest one on any given night - and since they live right there in town, ought to know darn well already what your rate is.
  • This goes five to ten times over for the worst 'discount' of all: no hourly or 'short-stay' rates. This is a no-brainer: only someone with no brains would offer those kind of rates. You're inviting problems and damage to your hotel's reputation if you pursue or pander to the sex trade. (For the same reason, if you have waterbeds or jacuzzis or mirrored ceilings in your rooms, they need to go . . .) You know you're renting to the wrong kind of people if your night guy gets calls at 2:30am on the switchboard from guests demanding to know if "y'all got condoms at the front desk".
  • Disruptive people get removed forthwith. More benign misbehavior - overstaying check-out, noise complaints if they comply promptly with a warning, having undesirables over as visitors, having one or two more people in the room than the number of registered guests as long as they don't get too noisy  - might not be worth the trouble and drama of instant ejectment (which will nearly always require police involvement), but they'll go on the "DO NOT RENT' list - the 'naughty list' - in case they ever return.
  • No "warehousing". Rooms may only be rented to an individual who will be actually occupying the room until they check out: no one may rent a room for someone else. You can't "warehouse" someone in there. (It's my only assurance that you don't have Abu Bakr al-Baghdadi stashed in there.)  Otherwise, that someone else that is occupying the room must be the one registered as a guest - or not, if they're on the naughty list.
  • No stayovers by anyone other than the registered guest. If "Mr. Maderek" rented the room, then only "Mr. Maderek", and not another occupant of the room, can come in the next morning and pay for another night - and he must likewise show up in person to pay for any subsequent nights. And if we find out at some point that Mr. Maderek isn't actually occupying the room, or isn't present on property except when he comes in in the morning to pay for another night for whoever is in that room, then he goes on the naughty list, too . . . see the foregoing on 'warehousing'. That, and the above rule on 'warehousing', is what it would ultimately take for one hotel near where I live to get on top of its drug-and-prostitution problem: the manager told me, "we keep throwing them out, and they just get someone else to rent the room for them and come back" . . .
  • Known or suspected illegal activity may result in instant removal -- and will always, at the very least, result in permanent banishment. A steady stream of late-night visitors to a room, continuously through the night, until 4 or 5 a.m., is a pretty good indication that drugs are being dealt from the room, or one or more prostitutes are working; and unless you kick the door down and catch them in the act, that's as close to proof as you're going to get. If you don't see them doing the drugs, instant ejectment might be a bit much, but they do go on the naughty list and never rent a room there again. (I "can't judgepeople, more than one person has challenged me? Yes, I can -- bring it into my barn and see what happens. Judge Mike's court is in session. This hotel is my friend . . . and anyone who hurts my friend . . . [to paraphrase a decades-old Don Imus running gag ] . . .)  You run a private business, you don't need absolute proof, you don't owe them due process, and you don't even have to tell them why (if the signs indicate prostitution, it's best that you don't - you don't want to make a mistake and accuse an innocent woman so specifically). You're not a common carrier, you don't have to justify your decision to them. (To people who have no respect for the rights or property of others, nothing you say is going to justify it anyway).
  • We're not harboring you in the name of 'privacy' if the cops are looking for you. Beechmont's own privacy policy in pertinent part: "We freely share any guest registration information with local, civilian law enforcement authorities upon their request for any bona-fide law enforcement purpose: generally, any public peace officer need only show us a badge and give us a name. (If they give us yours, and you are the sort of individual for whom that could be a problem, perhaps you should seek accommodations elsewhere. We do not welcome the criminal, drug or vice elements, whether local or traveling.)  . . . " If the cops are looking for you or you've got warrants, our hotel isn't a good place for you to hide from them: we'll give you right up and hand you over. It's no inconvenience or issue for respectable transient, corporate or group guests: they generally don't have the police coming around looking for them.
  • Trash the room once, you're on the naughty list. Missing towels? You're on the naughty list. Damage to the room or the furniture? Persona non grata. Even if they offer to pay for it when they try to check in again,  hoping that'll get me to take them, I still won't take them: we want guests who don't damage the room or walk off with parts of it to begin with. (I should give them a warning first? Did they have any upbringing at all growing up, did Mommy teach them anything as a small child about how to behave or about the need to respect the rights and property of others? That was their warning . . . )  If you're tired of running your hotel and you want to sell it, call The Mumford Company in Newport News and try to get a decent price for it: don't sell it a piece at a time.
I've seen a lot of bad thinking go into renting to locals. Take care of them: they always come back. (So do cockroaches and bedbugs . . . do you want them back once they start showing up? After all, someone paid for a room for a night to bring them in, too . . . ) 
I've even seen more than one owner advocate, give them a little off the rate, they don't have much money - but if you see a guy who looks like a businessman drive up in a nice car, try to charge him extra, he's got money, he doesn't mind paying, he doesn't know we don't usually charge that much. (Nice. You're giving your most favorable terms to your most troublesome guests, and you're doing it on the backs of your most desirable. Over time, what sort of guests will that get you? And what kind of rate will you get?)
But if that's the best you can get for customers, either you don't need to be running a hotel, or you're running a hotel that needs to be shut down and the building put to some other use.
What to do about the problem? It's a hard decision once you let it get to the point where you've gotten it. You want to increase the number of rooms rented, and get a better rate, but it's not going to happen until you get rid of some of the customers you have: you can't just let the problem continue until you get ahead a few bucks.  The guests you need in order to grow your business aren't going to use your hotel as long as some of the guests you have remain there. And some investment in renovations, repositioning and perhaps rebranding is going to be necessary in order to attract guests who will behave themselves while they're there, which a lot of properties that become too 'local'-dependent are unable to make. That is why hotels that reach that state tend to get into a downward spiral and stay there.
Hiring a security guard can "help", but doing that isn't going to provide the help you actually need. It's a painkiller. It's like smoking cigarettes to relax. It's a methadone fix. It's like drinking heavily to treat major depression: it'll make you feel better when you're down, but it won't fix the depression, it'll just add alcoholism to it and cause you to be in even worse shape. It'll provide relief, but will do nothing to cure the disease.
Indeed, where I've seen it done in a hotel with a problem like yours, it sets the problem in place, maybe makes it worse. Once the security guard is hired, the owner or manager feels all the more free to rent rooms to the kind of guests that you need a security guard on property in order to manage. Hotel security guards have their place, but only in very large hotels, hotels with a lounge, bar or nightclub on property, hotels in a borderline neighborhood where crime originating from nearby places off-property can be a problem, or hotels located in isolated areas where a police response can take awhile.
I've seen very few other hotels that needed a security guard, and most of the hotels I've seen that have them misuse them. How so, at both hotels where I worked with a security guard that I'm now in the process of 'retiring'? We readily agreed, at each of those two hotels, that if we removed him and brought up a Marine rifle platoon from Camp Lejeune to put in charge of security instead, the hotel would still have just as many of the same problems, because of the way it was marketed, and because of the kind of people to whom the owners rented rooms. The only difference would be the response time in confronting and dealing with them. If you use your rooms to board stray dogs, you're going to have fleas in your hotel: likewise, if you rent your rooms to troublemakers, you're going to have trouble in your hotel.
We just terminated our relationship with the owners of the last hotel I tried to work with that had a security guard: they have the same problem as your hotel, and they wanted us to 'manage' it, not fix it. ("I don't 'talk to them right'"?  Hey, I'm not the Drunken, Drug-using, Lowlife Scumbag Redneck and Urban Hoodlum Whisperer! . . . ) 
I wish I could offer you more encouragement. But there's only one course of action I can encourage you to take on this one. You're going to have to bite the bullet. Hard.
Many have gone before you and tried to make other approaches work. None have succeeded.

Originally appeared on Quora

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